Saturday, June 8, 2013

SoftBank could attempt to buy T-Mobile US if its bid for Sprint is turned down

One man's trash is another man's treasure: Deutsche Telekom could finally exit the U.S. market

With its attempted purchase of Sprint potentially in jeopardy, SoftBank is actively considering buying T-Mobile US as a fall-back plan. Sprint and SoftBank seem confident that its current deal will go through, however a few billion extra dollars from Dish may be enough to force Sprint's hands into taking the more profitable deal -- and SoftBank is reportedly ready to move right on down the line to the next U.S. carrier it can buy, T-Mobile. After its merger with MetroPCS, T-Mobile (now T-Mobile US) is a publicly traded company, making its former parent company Deutsche Telekom now just a majority shareholder. According to three sources to Reuters, the Japanese carrier is returning to talks previously held between it and Deutsche Telekom pertaining to buying its stake in the U.S. carrier.

Just as Deutsche Telekom wanted, this structure makes it a much simpler proposition to sell off its 74-percent stake in T-Mobile US to another company, such as SoftBank, if it wants a final exit from the U.S. At its current valuation T-Mobile US is worth about $15 billion, or $5 billion less than SoftBank currently has on the table to buy Sprint. The numbers work out, and it's no secret that DT has had one foot out the door for some time now -- SoftBank could just be the final piece to make everyone happy.